He made the announcement during a press conference after meeting with Sabah Barisan Nasional leaders and civil servants yesterday.

Abdullah said many of the issues were raised during his visit to the state on April 7.

“We, in the Federal Government, have considered the request made and are acting upon it,” he said, adding that they needed to act on them step by step.

Among the most significant is abolishing the Sabah Federal Development Department (JPSS) which had come under a lot of criticism. The Sabah State Development Office will take its place.

The five division development offices in Tawau, Sandakan, Kudat, Beaufort/Keningau and Kota Belud would be abolished.

The move resulted in the abolishment of 207 positions and the staff of the JPSS would be placed in the Sabah District Offices and their emolument of RM1.69mil would be paid by the Federal Government.

With the abolishment of the JPPS, federal funding for agencies like the Public Works Department and Health Department would go through the local development offices.

Abdullah said Sabah would enjoy a RM1bil special allocation for rural development.

A new formula to distribute the allocation would be used. The new formula would give 35% weightage to population, 35% to district area and 30% to the development or poverty rate.

Although Sabah received the second highest allocation of RM18.46bil under the 9th Malaysia Plan, Abdullah said the state needed more funds and this would be rectified under the mid-term review of the 9th Malaysia Plan.

A review of the implementation mechanism would also be carried out.

Other benefits include the direct channelling of development allocation of 11 ministries, namely the Prime Minister’s Department; Finance; Works; Rural Development; Health; Education; Housing and Local Government; Tourism; Unity, Culture, Arts and Heritage; Youth and Sports and Home Affairs.

A panel co-chaired by the Sabah state secretary and Sabah federal secretary had been formed to identify and streamline overlapping roles in state and federal departments.

The Economic Planning Unit of the Prime Minister’s Department would also review development projects together with the Sabah and Sarawak state economic planning units before approving and implementing them.

Abdullah said a high-powered Cabinet committee under Deputy Prime Minister Datuk Seri Najib Tun Razak would be set up to tackle Sabah’s long standing illegal immigrant and refugee problem.

He added that the National Security Council had increased the number of detention centres in the state from three to five, with the new centres in Papar and Sandakan.

The Government pledged to continue to reduce the hardcore poverty level to 2.8% by 2010.

A focus group on poverty had been set up for “poverty mapping” and to monitor and coordinate the implementation of poverty eradication programmes.

Abdullah also made several other announcements. He said Prof Datuk Kamarulzaman Ampong would become the first Sabahan vice chancellor effective June 18 while Yusof Saringit, also a Sabahan, would become federal Chief Financial Officer for the state.

He added that Petronas would set up a 300MW-gas powered plant in Kimanis and also come out with a master plan to set up downstream petroleum industry in Sabah.

An additional RM400,000 allocation would be given to each state constituency for rural projects, he added.

He also said the implementation of a 40% import duty on chicken parts for Sabah and Sarawak would be deferred to Aug 31.